First-time home buyers are flooding into the housing market to take advantage of the federal government’s increased grants and low mortgage rates, new data suggests. First-time home buyers made up 25.4 per cent of home loans granted in December, the highest proportion since December 2001 - the height of the last major housing boom.
As part of last year’s $10.4 billion economic stimulus package, the government doubled the first home buyers grant to $14,000 for the purchase of existing homes, and to $21,000 for newly built properties, until June. The Reserve Bank of Australia (RBA) had cut its official rate by 300 basis points between September and December, a large proportion of which was matched in mortgage rates. Earlier this month, the RBA cut the cash rate by a further 100 basis points to a 45-year low of 3.25 per cent. Overall, 52,874 owner-occupier home loans were taken out in December, a 6.4 per cent seasonally adjusted increase compared to the previous month. This is the third consecutive monthly increase.
Economists had expected the number of owner-occupier home loans to rise by 3.5 per cent in December. Loans for new dwellings skyrocketed 15.2 per cent in the month, seasonally adjusted, as consumers took advantage of falling interest rates and grants for first time buyers on new homes announced by the government in October. (SOURCE - livenews.com.au and Sydney Morning Herald). Are you or someone you know interested in taking advantage of the First Home Owners Grant and low interest rates to enter the property market? If so, I’d love to help.

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